Coordination Effect of Oligopolists' Multimarket Contact

ABSTRACT In this article, we examine the coordination effect of oligopolists' multimarket contact with asymmetric cost. We extend a model of infinitely repeated multimarket contact games with “symmetric advantage” in the seminal paper of Bernheim and Whinston ( The RAND Journal of Economics 1990; 21(1): 1–26). We consider Stackelberg and Cournot competition as the stage game while Bernheim and Whinston consider Bertrand competition. Different from Bernheim and Whinston, we show that collusive sustainability under multimarket contact is the same to single‐market if the stage games are Stackelberg competition. Our research has policy implications for the antimonopoly review of the merger and detecting cartels.